529 Plan can protect college savings

As the stock market took a dive over the past year, a lot of people's college savings dove as well. Meantime, tuitions keep going up.

That's why the Pennsylvania Treasury Department is urging residents to take a look at the State's 529 Guaranteed Savings Plan.

Many states offer 529 plans, but Pennsylvania is one of the few states that has a no-risk option.

"We have in PA, one of the only guaranteed savings programs, " says Penna. State Treasurer Rob McCord.

"And those guaranteed savings programs allow people to buy college credits at today's prices and know that they're always there and can't be taken away, and will be there at future prices."

529 plans allow you to get a tax break on money you save for college, grad-school or trade school.

And saving for college now can really pay off in the long run.

McCord explains, "The average college graduate makes 50% more over the course of a lifetime, versus someone of equal skill, who didn't graduate from college."

McCord says only five percent of middle-income Pennsylvanians invest in 529 plans. To encourage people to invest, between now and October 13th, the state is waiving the $50 registration fee and all new account-holders will be entered into a sweepstakes.

"The top winner will get $25,000 towards her or his favorite student, and four other families will get $2500 dollars," McCord says.